I describe the market action before the opening bell and after the close and discuss set-ups for the next day.
Updating a similar theme from the end of last week, a current ‘updated’ view of market internals of the S&P 500 show further deterioration, which underscores the heightened probability – but not certainty – of a market correction this week.
Maybe you’re asking the same question as I am: “How many times will the SPY repeat the same script/pattern?”
What pattern is that, you ask? Take a look at my prior post:
I wanted to share two recent, clear examples of how to project a final price target to play for from a symmetrical triangle pattern formation.
The S&P 500 cracked the key 1,100 resistance level, and it was met as expected with a surge of “popped stops” as bears threw in the towel – which serves as another example of “what happens when key resistance is broken?”
However, we’re not seeing the classic signs of strength that accompany strong price breakouts… but does that need to be the case in the current altered financial landscape?
Do old rules still apply? Let’s take a look.
With the US Dollar Index completing its daily Bull Flag, the Euro completed an opposite bear flag. Both currency indexes are at key inflection points, so let’s take a quick look at the key level to watch now in the Euro Index.
I wanted to do a quick update showing the key resistance level at 1,100 that either will hold as an overhead sell signal, or break as buyers continue pushing prices higher, triggering a “popped stops” rally if they can move the index above 1,100.
There are converging trendlines evident on the daily chart of gold, and I thought that structure would be worth a closer look.
Here is a quick ‘chart view’ of Gold’s daily ‘triangle:’
If you feel like the market is in Déjà Vu mode intraday, rest assured that you are picking up on a repeating pattern so far over the last three trading days, particularly for intraday traders.
Let’s step inside the recent retracement rally and view the current state of the three key “Market Internals” and what clues those internals are revealing.
I always enjoy showing clear examples of trading concepts such as divergences, and today gave two solid examples of the dual Momentum and TICK divergences preceding intraday price reversals.
In fact, the absolute low and high of the session was formed with such a dual divergence.